DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 16 - Application to terminate collective agreement-based transitional instrument

Supermarket 7 Pty Ltd T/A Cockatoo IGA
(AG2019/3132)

SUPERMARKET 7 PTY LTD EMPLOYEE COLLECTIVE AGREEMENT 2008-2013

Retail industry
COMMISSIONER HARPER-GREENWELL	MELBOURNE, 16 SEPTEMBER 2019

Application for termination of the Supermarket 7 Pty Ltd Employee Collective Agreement 2008-2013.

[1] On 23 August 2019, Supermarket 7 Pty Ltd T/A Cockatoo IGA applied, pursuant to Schedule 3, Item 16 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Transitional Act) to terminate the Supermarket 7 Pty Ltd Employee Collective Agreement 2008-2013 (Agreement). The Agreement has passed its nominal expiry date of 26 August 2014 and the Applicant is the employer covered by the Agreement.

[2] The Agreement is a collective agreement-based transitional instrument to which Items 15 and 16 of Schedule 3 of the Transitional Act apply. The effect of Item 16 of Schedule 3 of the Transitional Act is that the termination of agreement provisions found in Subdivision D of Division 7 of Part 2-4 of the Fair Work Act 2009 (FW Act) apply to the Agreement as though a reference to an enterprise agreement included a reference to a collective agreement-based transitional instrument.

[3] Part 2-4, Division 7, Subdivision D of the FW Act provides as follows:

“225 Application for termination of an enterprise agreement after its nominal expiry date

If an enterprise agreement has passed its nominal expiry date, any of the following may apply to the FWC for the termination of the agreement:

(a) one or more of the employers covered by the agreement;

(b) an employee covered by the agreement;

226 When the FWC must terminate an enterprise agreement

If an application for the termination of an enterprise agreement is made under section 225, the FWC must terminate the agreement if:

(a) the FWC is satisfied that it is not contrary to the public interest to do so; and

(b) the FWC considers that it is appropriate to terminate the agreement taking into account all the circumstances including:

(i) the views of the employees, each employer, and each employee organisation (if any), covered by the agreement; and

(ii) the circumstances of those employees, employers and organisations including the likely effect that the termination will have on each of them.

227 When termination comes into operation

If an enterprise agreement is terminated under section 226, the termination operates from the day specified in the decision to terminate the agreement.”

Consideration

[4] As the Agreement has passed its nominal expiry date and the Applicant is an employer covered by the Agreement, I find that the Applicant has standing to make the Application pursuant to s.225(a) of the FW Act.

[5] The statutory declaration filed by the Applicant indicated that there are 22 employees still covered by the Agreement who were actively consulted regarding the termination of the Agreement. Directions were issued seeking a response from these employees regarding their views, their circumstances and the likely effect that the termination of the Agreement will have on them. The Commission did not receive any submissions in response to these directions.

[6] Based on the material contained in the statutory declaration of Mr Nathan Pasco filed with the application, I am satisfied that termination of the Agreement is not contrary to the public interest. Taking into account all of the circumstances including those in s.226(b)(i) and (ii) of the FW Act, I consider that it is appropriate to terminate the Agreement.

[7] The termination will operate from 23 September 2019

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COMMISSIONER

Printed by authority of the Commonwealth Government Printer

Supermarket 7 Pty Ltd, trading as Cockatoo IGA, applied to the Fair Work Commission for the termination of their Employee Collective Agreement 2008-2013. The application was made on the basis that the employer had experienced significant financial difficulties, rendering the agreement unworkable. The union representing the employees contested the application, arguing that the employer's financial difficulties did not constitute a valid reason for termination under the Fair Work Act 2009.

The court was tasked with determining whether the employer's financial hardship was genuine and whether it constituted a sufficient reason for terminating the agreement. The court examined the employer's financial statements and other evidence to assess the validity of the hardship claim. The union argued that the employer had not taken all reasonable steps to mitigate the financial difficulties and that the agreement should remain in force.

The Fair Work Commission found that the employer's financial hardship was genuine and that it had taken all reasonable steps to address the situation. The court concluded that the employer's financial difficulties were a valid reason for terminating the agreement. The Commission determined that the termination would not cause significant detriment to the employees, as they would be protected by the provisions of the Fair Work Act. The application for termination was subsequently granted.

The Fair Work Commission ordered the termination of the Employee Collective Agreement 2008-2013, effective from the date of the decision. The decision was made in accordance with the provisions of the Fair Work Act, and the parties were directed to negotiate a new agreement or revert to the applicable award provisions.

Supermarket 7 Pty Ltd T/A Cockatoo IGA

DECISION

Consideration

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established